A day that changed everything

Michelle Grattan

Tony Abbott's ascension to the Liberal leadership has hit the capital like a hurricane, leaving no one untouched.

Many Liberals are still shaking their heads at their decision to install Tony Abbott as leader. ''What have we done?'' they ask themselves. Abbott's ascension has sweeping implications for the Opposition's electoral positioning, the Liberals' internal dynamics, and relations between the Coalition partners. It has already profoundly affected the climate debate in this country and will continue to do so. How the voters will react is unpredictable.

Astoundingly, the Liberals opted for Abbott after thinking they were headed to Joe Hockey, who 24 hours before the vote had a broad consensus, including from the right. Early on Monday, Hockey was thought to have about 80 per cent of the vote.

A switch to Hockey, Malcolm Turnbull's ideological soulmate, would have been a change of suit for the Opposition, not a whole new wardrobe (apart from whatever happened on the emissions trading legislation).

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The game changed decisively at 6.52pm. At that moment, in a meeting of senior Liberals, Abbott told Hockey he would run against him, because he couldn't accept Hockey's proposal for a conscience vote on the emissions legislation, then being debated in the Senate.

After talks late last week and through the weekend, those moving against Turnbull held three meetings on Monday at 10am, 4pm and 6pm. Key attendees included Hockey, his putative deputy Peter Dutton, Liberal director Brian Loughnane, Abbott, right-wing powerbroker Nick Minchin, environment spokesman Greg Hunt, manager of Opposition business Christopher Pyne, and Andrew Robb, former emissions spokesman who threw the grenade at Turnbull last week by opposing the Macfarlane-Wong deal.

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They were grappling with how a new leader would handle the legislation that had mortally wounded Turnbull and that would be the key factor in determining who would succeed him.

During the day, Family First senator Steve Fielding (who had a key vote) knocked out the possibility of referring the legislation to a committee, which Hockey had been expected to support (though he was reluctant). Hockey was then caught between sticking to his past backing for the bills or opposing them.

In the 4pm discussion, Hockey raised the idea of a free vote. Abbott and Minchin wouldn't buy it because there would be enough Liberals supporting the bills to pass them.

The alternative (which Abbott eventually used) was a party-room secret ballot. Some at the meeting tried to talk Hockey out of the conscience vote. His position is seen variously as courageous or bad judgment. Whichever, his decision not only destroyed his chances but led to the legislation he supported being defeated and the party delivered to his ideological opponents.

To take the most immediate effect first: by scuttling the legislation, Abbott has transformed the climate debate. The Government will fight on for its scheme. But the Liberals have moved from, under Turnbull (and Howard), believing in emissions trading in principle, to turning their backs on a market-based approach. Abbott's scare campaign about Kevin Rudd's ''great big new tax'' will make the issue harder for the PM; Abbott's ditching of emissions trading will weaken the Liberals' climate credentials.

More broadly, it is hard to know where to start when thinking about what Abbott will do with the Opposition. He is a man with plenty in his mind and a habit of changing it not infrequently - as he did even on the emissions legislation over a few months. He tilts well to the right and to social conservatism, but is also compassionate.

He promises to foster a broad Liberal church (but don't they all?), saying this will be reflected in his frontbench. Still, Abbott's victory is scary for Liberal moderates. They were already struggling; the right was dictating stands to Turnbull and ultimately brought him down. The election will also see the back of prominent moderates Petro Georgiou and Judith Troeth, both Victorians, who have been willing to match their views with action (Troeth crossed the floor on the emissions legislation). The moderates are in desperate need of a blood transfusion.

The Nationals have had their transfusion, with the rise of Barnaby Joyce, their Senate leader, who has effectively taken over the party. He ran the Nationals' assault on the emissions trading scheme, with a big knock-on effect for the Liberals. Now Joyce, a member of the merged Queensland Liberal National Party, will join Abbott's frontbench, a couple of wild men who've found each other. Recently Coalition tensions were so bad that there was speculation about a possible split. Relations will now improve.

But there are complications for the Nats; Joyce, as a frontbencher, will have to be more constrained. And his party, which has been differentiating its patch, suddenly finds the Abbott Liberals squatting on its land. One Liberal predicts a move from ''unmanaged differentiation to managed differentiation''.

With less than a year to the election and horrible opinion polls, Abbott takes over the leadership in the most difficult circumstances. The internal Liberal debate over climate will continue, with the Government planning to bring back the emissions legislation in February and the Opposition facing the difficult task of having to develop a credible alternative.

The Liberals are bracing for a reality check in this weekend's Higgins and Bradfield (NSW) byelections.

Liberal sources claim Higgins, on 7.1 per cent, is lineball. After allowing for Peter Costello's personal vote, a bad result there, where there is no Labor candidate but a high-profile Green, Clive Hamilton, would be seen as a comment not only about the leadership infighting but also about the step back on climate policy.